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Update letter to Montana Racing Supporters

January 17, 2006     E-mail this page to a friend!

Dear Montana Racing Supporters:

Jan. 13 - It has been just over a month since our last letter. Both Ray ‘Topper’ Tracy and Tom Tucker have been talking with some of you as well as doing some research. Let us bring you up to speed. (In the following paragraphs, ‘we’ refers to both Topper and Tom).

We have spent the last five weeks talking with people that support the racing industry (horsemen and breeders), other racing jurisdictions, and people in the gaming industry here in Montana, as well as others. The alarming thing that we both have experienced is the small number of people that are concerned. Maybe it’s apathy, confusion, frustration, not knowing where to start, or an attitude of “wait and see.”

We have had some good discussions in regards to what needs to be done. Some people suggested different types of wagering to increase handle while others went as far as to suggest throwing everything out and starting over, very similar to what Alberta, Canada did some years ago. Hopefully the answer(s) can be found somewhere in between. With the lack of organizations involved in the racing industry in Montana, there really isn’t any cooperative effort currently active to make changes. However, we think that everyone at the meeting in December would agree something needs to change and the sooner the better.

Another point that needs to be made is that many of the people we talked with expressed concern that money wouldn’t solve all the problems. Race meets offering better purses was just part of the overall Montana industry equation. Other items were: better marketing of the racing product, breeding industry revitalization, Montana Board of Horse Racing taking the lead to bring horsemen, community leaders and race tracks together, and as mentioned earlier, an effort similar to what Alberta, Canada did in terms of combining all the elements of the industry under one organization and funding it with other forms of gambling.

A few years ago the Montana Horseman Association had been very active and then just seemed to dissolve or cease to exist. At any rate it could be reinstated and a new board could be formed that could include representatives from every group in the state. They could formulate policy, promote the industry and develop programs. And perhaps that a leadership roll in solving the problems of the industry.

Whatever we choose to move forward with, two things are certain: (1) We need to come up with a funding plan and (2) more than 10 or 15 people need to be involved. What we need is more like 150 to 200 in active participation.

Both of us promised in December that we would work towards a meeting with the Governor’s office. The feeling was that if the Governor’s office would come out in support of some proposed legislative changes, that would give us a leg up. We were hoping for 3 or 4 names that could represent the industry. If you have any, please let us know. The MBOHR prefers to take a passive role in this process.

The idea that seems to be receiving the best response (meaning the path of least resistance) is this:

15% of the NET (coins dropped minus coins paid out) revenues from the poker machines is sent to Helena. From that, roughly 2/3 is returned to local and county governments. Since the introduction of the poker machines, the racing industry has witnessed the decline of live handles from $16,000,000 a year to less than $2,000,000. That equates to a yearly loss in revenues of over $2,800,000. Introduce a bill that will set aside the other 1/3 (5% of the NET) that currently goes into the general fund from the poker machine taxes in Montana FROM OUR CURRENT SIMULCAST SITES to be used to offset the loss of on-track handle. Put a limit of $2,000,000 on it.

Of the current 10 simulcast sites, this could generate around $300,000. If we were able to add a few more sites, it might come closer to $500,000. Is this enough? Are we thinking too small? This certainly would meet with less resistance than a new form of gambling, slots at the race track or fantasy sports wagering. But it pales in comparison to what Alberta achieved or what is going on around the country. We have a large hurdle to overcome as the gambling industry in Montana has dwarfed what the racing industry ever accomplished and continues to grow while racing continues to shrink.

Another item of thought is in regards to account wagering. Maybe this is part of the legislation or not. All the jurisdictions around us have account wagering, which allows money to be placed into an account and people phone in their wagers. How much simulcast handle we have lost to this illegally is hard to estimate, but it seems to be the future of pari-mutuel wagering.

We have added a few more names to our mail list and if you have any other names, let us know. Remember, we are always open for more suggestions, nothing is set in stone and we are always willing to help spread any new ideas.

We need some comments in regards to people that can meet with the Governor’s office. It seems that the sooner we move on this, the better. Let us know what you are thinking. Also, if you think we are leaving something on the table, maybe we need one or two other ideas to be discussed with the Governor’s office. Who knows, if we get the opportunity and the Governor’s office is receptive, something totally off the wall may appear.

In the meantime, we will continue to toss ideas around and are anxious to hear any comments.

Tom Tucker
IMS Racing

Ray “Topper” Tracy
The Racing Journal